Ben Teerlink of MMI: Why Outsourcing Business Intelligence is the Smart Choice
Ben Teerlink is founder and CEO of Mobility Market Intelligence, Salt Lake City, Utah, a provider of data intelligence and market insight tools for lenders, real estate agents, real estate brokerages and title companies. With a background in both real estate and data analytics, he uses his breadth of experience to expand the mortgage and real estate industries’ understanding of how the right data can be used to influence growth and positively impact business operations.
The National Collegiate Athletic Association highly regulates college sports, and that includes the number of coaches teams can have on staff. However, the limit on coaches does not extend to analysts, leading some of the top teams in the nation to hire former head coaches or up-and-coming coaches as offensive and defensive analysts. This way, teams benefit from the expertise of highly experienced coaches without running afoul of NCAA coaching limits. In essence, teams are outsourcing coaching talent.
In business settings, the word “outsourcing” can often elicit a negative response, as many equate outsourcing with layoffs, offshoring and even a decline in the quality of work output. While this might have been the case historically, many outsourcing vendors have taken these concerns to heart when building out their service offerings. With the right partner, outsourcing can beef up expertise in a particular area without bringing on the expense of a full-time employee – a role reversal of sorts from the traditional labor shortage/cost containment use case.
In the traditional sense, outsourcing refers to outsourcing labor servicers to control costs. However, businesses that rely on an outside partner to complete a function or fill a role are essentially outsourcing that function. Most businesses just use the word vendor rather than outsource; but they are the same thing. In the mortgage industry, most lenders rely on third parties for technology development in some capacity, as few have the financial and/or human capital needed to develop and continually update crucial technology such as loan origination systems and point of sale platforms in-house. Instead, they choose to streamline operations by outsourcing the development of these technologies to those who specialize in that. With this in mind, is it time for lenders to outsource their business intelligence, too?
Choosing a BI partner
If they opt to go that route, choosing a BI partner requires lenders to use the same criteria they would when selecting any other vendor. Many lenders prefer to choose a vendor or technology that easily fits into the lender’s current operational processes, has similar business practices and demonstrates a proven history of results. And because of the specialized and highly regulated nature of the mortgage industry, most lenders also prefer to work with a vendor already focused on the mortgage and financial services industries.
Just like other vendors, BI offers multiple options to lenders looking to outsource. Some lenders may choose to engage a team of analysts or consultants for a fraction of the cost of employing those individuals in-house. For others, the best solution is to engage a BI software tool that aggregates data from outside sources and provides commonly used industry analytics from the data. Others still will look for a software tool with its own data and analytics that allows the lender to also plug in their own data, increasing the relevance of the analytics and insights provided.
What BI has to offer
When looking for a BI partner, lenders should focus first on ensuring the BI tool will provide competitive analysis and insights that align with the lender’s current business and growth goals. The college coaches have hired analysts to help get the team to the national championship game, not simply to give their opinion on the best uniform combination. Most lenders are relying on BI to help grow their production numbers, not simply monitor performance stats. Without confirming that a BI tool’s objectives align with a lender’s stated goals, the relationship will not be a winning one. For most top lenders, “must-have” features and functions include in-depth market analysis; real-time market data; the ability to drill down into that data at the state, metropolitan statistical area or county level; in-depth loan originator performance metrics and benchmark statistics for lenders and LOs nationwide. Top BI partners will provide these features and tools that deliver further insights.
For some lenders, BI simply means analyzing their own internal data sources to look at company, branch and LO performance, as well as monitoring their progress towards internal goals. But without external market data for comparison, these lenders are unable to view a complete picture of how they are faring against local competition or what they could do to improve. By marrying the internal and external data sources, lenders can get a more complete analysis of their current and future situation.
Adding to the team doesn’t mean benching someone else
Keeping track of this sort of data is nothing new, meaning the proposal of working with a BI partner once again brings up thoughts of layoffs. Again, this does not have to be the case. In the past, lenders have transitioned from an internal compliance department to outsourced compliance operations and have still relied on an internal compliance officer and have been able to transition others to new internal roles. Similarly, lenders with existing internal BI operations will still require the expertise of an intelligence executive, who will serve as the liaison with the BI partner and the lender’s arbiter of business intelligence.
Just like the coaches of a college football team, lenders can succeed all on their own. But that doesn’t mean they have to. The top teams rely on analysts to provide additional expertise without overcrowding the sidelines, and lenders should take a page out of their playbook. Outsourcing to the right BI partner doesn’t feel like outsourcing at all – it’s partnering up to receive industry-leading expertise and become a better and higher-ranking team, all without facing an overstaffing dilemma.
(Views expressed in this article do not necessarily reflect policies of the Mortgage Bankers Association, nor do they connote an MBA endorsement of a specific company, product or service. MBA NewsLink welcomes your submissions. Inquiries can be sent to Mike Sorohan, editor, at msorohan@mba.org; or Michael Tucker, editorial manager, at mtucker@mba.org.)
